Mental Models Towards Problems

February 4, 2009

Learn from your mistakes.  It sounds so nice in theory, but it often breaks down it practice, particularly for Type A personalities. An intermediary step that’s usually missing is first learning how to honor the missteps, as odd as that may sound.  Most of us treat mistakes as toxic, to be avoided at all costs, minimized with good planning and prudent choices. But well-intentioned mistakes are vital ingredients in the improvement process, and they must be honored as invaluable assets. This often requires a big shift in our mental models towards being wrong.

I often hear managers tell employees not to “bring me problems unless you have the solution.”  It’s meant to foster self-reliance and proactive problem-solving, values we like to celebrate here in America, but the attitude can be poisonous to an organization.  If we only solve problems that are co-located with solutions – or put any other diminishing effect on the surfacing of problems – we are dampening our ability to learn and improve.  Surfacing problems can be a solo sport, but addressing problems of consequence usually requires a team.  It is the obligation of leaders to set the tone for employees – to create a culture where problems are viewed as a path to competitive advantage, as a way to learn and innovate at a faster rate than competitors. Leaders must make it crystal clear that embracing mistakes is not an invitation to fail — it’s a radical  prescription to thrive.


Unsolicited Advice for Starbucks

February 2, 2009

Starbucks’ early success was the result of a lot of very smart, new thinking, including creating a market for higher-end coffee drinks and tapping into consumers’ need for a “third place” outside of work and home.  For many years it thrived as it competed on its innovative business model, a relatively focused positioning. Starbucks delivered a specific experience to a specific set of customers (think Southwest not United).

For all its breakthrough thinking, its status as a public company meant that it still had to tame the growth beast.  And then it came to an inflection point that most focused competitors reach, how to continue to grow after the first wave of saturation.   It’s here where I think Starbucks stumbled.  The company had two choices for growth — continue to expand its focused service offering at the risk of diluting the Starbucks brand or creating a new brand that would allow Starbucks Inc. to grow and learn outside of the constraints of its original offering.

The company chose the former – all too many focused competitors do – and has suffered the consequences.  In doing so, it’s made a classic mistake, essentially trading off quality for growth.  But this is a false tradeoff that can be overcome  in creative ways that do not require abusing the brand.  Yum Brands is a good example. Yum is a collection of five quick-serve restaurants.  The overall Yum organization has ambitious growth expectations, but it doesn’t rely on any one brand to get there.  Yum reveals that it’s possible to have a multi-focused organization. For the sake of my tall skim, extra hot, no foam latte with an extra shot, I hope Starbucks gets this message soon.


Service Excellence Reading List

February 1, 2009

I’m often asked to provide a reading list on how to compete on service excellence. There are some great public sources out there. Below is a first cut (if you want more focused recommendations, please let me know), and I will plan to update this post on a regular basis.

Harvard Business Review Articles

  1. The Four Things a Service Business Must Get Right – if you’ll indulge me, I’ll start with my own article on how to design for service excellence.
  2. The Contribution Revolution – Scott Cook on how to more heavily involve customers in performing a company’s work.
  3. Companies and the Customers Who Hate Them – Gail McGovern and Youngme Moon on how companies can avoid antagonizing their customers.
  4. Why Incentive Plans Cannot Work – Alfie Kohn’s somewhat controversial argument on why monetary incentives send the wrong signal in a corporation.

Books

  1. The Ownership Quotient –  A book about getting employees and customers to behave like owners from the authors of The Service Profit Chain (which revolutionized service management).
  2. Customer Mania – A book about building a customer-focused company by Ken Blanchard and co-authors.
  3. Competing on Analytics – A book about using the ever-increasing data accumulating in firms in smart and creative ways from Tom Davenport and Jeanne Harris.


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